August 20, 2013

THEIR REPUBLICAN PRESIDENT:

Mexico's president may quietly be planning to surrender more of the oil industry than his countrymen think (Roberto A. Ferdman, August 15, 2013 , Quartz)
 
In a masterful balancing act, Peña Nieto reckoned he could find a middle ground between those who vehemently oppose opening up the state-run oil industry and those who believe it absolutely necessary. In his public remarks, he said he wants to open the sector to private and foreign investment, but not private and foreign production--meaning that foreign companies will be able to invest in Pemex, Mexico's national oil monopoly, but not drill in or own the country's reserves themselves.

Strange as the duality sounds, it's quite astute--theoretically, anyway. Not allowing foreign companies to own the oil means Peña Nieto can still tell nationalists, for whom oil is sacrosanct, that the country hasn't relinquished its precious reserves. César Camacho, chairman of Peña Nieto's Institutional Revolutionary Party (PRI), said on Monday, "In no way is it a privatization. It is opening up the possibility for private capital to join public policies... without going as far as concessions."

Fair. Except there seems to be a catch. Peña Nieto appears to have said one thing, but written another. "If you actually look at the wording of the constitutional reform, it leaves the possibility of production-sharing open," director of the Woodrow Wilson Center's Mexico Institute, Duncan Wood, told Quartz.

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Posted by at August 20, 2013 1:39 PM
  

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